Subsidiary Capability Upgrading and Parent-Subsidiary Relationship: Insights from a Chinese Acquisition in the United Kingdom

Abstract Purpose This study aims to explore capability upgrading of EMNE?s subsidiaries in developed countries and how the parent-subsidiary relationship influences such upgrading. Methodology/approach The study adopts an interdisciplinary approach to capability upgrading of EMNEs subsidiaries in developed countries. It employs a single case study to explore this under-research area. Findings The analysis challenges the orthodox view and suggests broad-based capability upgrading has taken place in the EMNE-acquired subsidiaries ranging from product, process, functional to intersectoral. In addition, the capability upgrading was contingent on the degree of subsidiary autonomy and subsidiary mandates. Originality/value This study represents one of the first to examine capability upgrading and parent-subsidiary relationship in the context of EMNEs? internationalisation activities.Abstract Purpose This study aims to explore capability upgrading of EMNE?s subsidiaries in developed countries and how the parent-subsidiary relationship influences such upgrading. Methodology/approach The study adopts an interdisciplinary approach to capability upgrading of EMNEs subsidiaries in developed countries. It employs a single case study to explore this under-research area. Findings The analysis challenges the orthodox view and suggests broad-based capability upgrading has taken place in the EMNE-acquired subsidiaries ranging from product, process, functional to intersectoral. In addition, the capability upgrading was contingent on the degree of subsidiary autonomy and subsidiary mandates. Originality/value This study represents one of the first to examine capability upgrading and parent-subsidiary relationship in the context of EMNEs? internationalisation activities.